ESG investment on the rise and AI an ally in corporate strategy, study finds


Bloomberg Intelligence and Bloomberg New Economy have released their first ESG Market Navigator survey.

The survey highlights the continuing significance of ESG in both corporate strategies and financial markets.

Despite current challenges and only 55% of C-suite executives ranking it as a top priority, there is an evident long-term commitment to ESG, with 85% of surveyed investors and companies planning to increase ESG investments over the next five years.

The survey, encompassing 250 C-suite executives and 250 investors globally, identifies the costs of transition and regulatory compliance as significant obstacles. Yet, a robust 84% of executives acknowledge ESG’s role in fostering a more resilient corporate strategy and its importance in M&A activities. Additionally, there’s a substantial fear among 81% of executives about losing market share to more ESG-compliant competitors. Most executives (70%) see energy transition as a competitive edge, while 75% recognize the risks of not planning for ESG, including revenue loss and activism threats.

From an investor perspective, 85% believe that ESG contributes to better returns and portfolio resilience. Despite challenges like data consistency and fund regulations, a notable 90% of respondents see ESG driving superior returns in the coming year. The survey also underscores the emerging importance of Artificial Intelligence (AI) in ESG, with 90% of participants viewing AI as beneficial for enhancing traceability and data quality.

Global ESG Research and Strategy Director at Bloomberg Intelligence, Adeline Diab, emphasized the evolution of ESG from a marginal concern to a mandated necessity. She highlighted the growing investor-corporate dialogue on ESG, with 60% of investors holding companies accountable and 40% of executives facing ESG inquiries in over half of their investor calls. Diab expressed confidence that this scrutiny will lead to a more credible ESG market.

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